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Tuesday, Feb 20, 2024

Economic Driver

SPORTS: Farmers Open’s $67.5M Impact Part of Region’s Leadership in Golf Industry

LA JOLLA – With the Farmers Insurance Open headed to Torrey Pines Golf Course along the scenic coast of La Jolla Wednesday, Jan. 24 through Saturday, Jan. 27 as the latest stop on the PGA Tour, the sport of golf will be an especially bright spotlight in San Diego County.
While the final group of pairings and tee times was not made public, with a Jan. 19 deadline for final commitments, as of Jan. 15, the field seeking part of the record-high $9 million purse was inclusive of 2021 Masters winner Hideki Matsuyama, 2021 Open Championship winner Collin Morikaway, 2019 Open Championship winner Shane Lowry and 2018 U.S. Open champion Gary Woodland.
Additionally, the field will include defending Farmers Insurance Open winners Max Homa (2023), Luke List (2022), Justin Rose (2019), Jason Day (2018 and 2015) and Brandt Snedeker (2016 and 2012).
The tournament typically draws 20,000 to 30,000 spectators. This year the event will be televised mostly by CBS and The Golf Channel as well as on myriad apps for those not able to make it in person.
The Farmers Insurance Open is a major economic driver in San Diego, where the golf industry is an important element of the region’s economy year-round.

Marty Gorsich
The Century Club of San Diego, Farmers Insurance Open

Marty Gorsich, CEO of The Century Club of San Diego/Farmers Insurance Open, said the group’s latest study from 2023 showed the tournament’s economic impact was $67.5 million.
“And with tourism being the second largest industry in town, we serve as a huge commercial domestically and internationally, with nearly 20 hours of television coverage across four days, for the beauty and aspirational climate conditions of our fair city,” Gorsich said.
The Century Club, a nonprofit, also uses the tournament as a means and platform to make a significant community impact in support of its locally based charity partners.

A Golf Hub

Beyond the tournament, golf’s economic story in San Diego is much heralded.
San Diego’s North County is a hub of golf equipment manufacturers that lead the world in technology and innovation, including TaylorMade Golf Company, Topgolf Callaway Brands Corp., Aldila, Cobra, Fujikura, Full Swing, Iliac and SKLZ in Carlsbad, and Scotty Cameron in Encinitas.
There are also a variety of golf apparel and accessory companies locally as well, including Linksoul in Oceanside and Vessel Golf Bags in Carlsbad. Titleist, based in Massachusetts, also has a presence in Carlsbad.
The sport continues to be on the upswing – through on-course golf and via the increasingly popular and accessible off-course opportunities such as Topgolf, a high-tech golf driving range game with electronically tracked golf balls and automatically scored drives.

David Abeles
President & CEO
TaylorMade Golf Company, Inc.

David Abeles, president and CEO of TaylorMade, and Chip Brewer, president and CEO of Topgolf Callaway, say that since COVID-19, participation and overall interest in golf has been growing exponentially around the globe. That growth includes San Diego, noted by Golf Digest as one of the top 50 golf destinations in the world.
“The state of the industry is as strong as I have seen in my 30 years in this industry,” Abeles said. “Sadly, because of a God-willing once-in-a-lifetime pandemic, we saw an influx of new golfers domestically and internationally that enabled the growth orientation of our category of our industry to truly accelerate.”
Abeles said that pre-pandemic, there were roughly 50 million golfers around the world, and that depending on what data source is studied, there are close to 60 million golfers now, “either entering for the first time or those who potentially had left the game and have come back.”
A study by the American Golf Industry Coalition says that about one in seven Americans played golf in 2022, resulting in $101.7 billion in direct economic impact, an increase of 20% from the $84.1 billion in economic impact in 2016.

Chip Brewer
President & CEO
Topgolf Callaway Brands

Abeles also said that there has been an increase in the number of women and juniors who are playing golf, making for a more family-oriented sport, and that the company has invested in R&D behind its product lines to diversify and ensure it has the right products to enhance performance for those new to the sport.
Brewer said that golf has “never been in a healthier spot,” with the game of golf larger and more dynamic.
He said that if you measure the total amount of unique individuals who will play one round of 18 holes on a golf course, it’s in a ballpark of 25 million or 26 million people.
“But the game is also being influenced now by an entire new form of golf course,” he said, referring to what is known as “off course golf,” which is the Topgolf model. “That is growing and inviting people to experience the game in a really easy, accessible and fun way to get exposed to the game that didn’t exist in a big way five or 10 years ago.”
Brewer said that the future of golf is pretty bright with structural growth in a sport that’s “passion based.”
“We’re very optimistic about golf,” he said. “The industry is a lot larger right now. I’ve never seen so much money in and around the game of golf. It’s a dynamic, like capitalism always is, but it’s obviously really good for those of us who love the game and make a living in the industry.”

Changing Course

Brewer also said there’s a new indoor golf league starting called TGL that is trying to get off the ground.
TGL presented by SoFi is the brainchild of golfers Tiger Woods and Rory McIlroy and is set to start in 2025 with six teams of four golfers competing in a custom-built arena. TGL is said to be incorporating innovative tech with virtual and real-life elements, with matches to air live on ESPN.
The way the Farmers Insurance Open is being held has also undergone some changes.
Gorsich said that a few years ago, the tournament was forced to depart from its long-held Thursday-through-Sunday event days to being the only PGA Tour event played Wednesday through Saturday.
That change was based on its Sunday being dominated on television by the broadcast of two National Football League conference championship games.
“As part of that shift we had to evolve our event since we now had three weekdays and one very busy weekend day,” he said.
The tournament became less focused on families and kids, who had school three of the days, and also couldn’t focus on huge crowds “because the logistics and parking are more challenging up on the hill at during the week.”
He said The Century Club/Famers Insurance Open moved its focus to a couple guest segments, one in particular being the working professional, based on their ability to better control their schedules during the weekdays.
Additionally, a major shift driven from the pandemic was the greater propensity for people to work from home, work remote or be comfortable being out of the office more.
“This made this corporate/business/working person a nice fit with our event since they could more easily join us as they ‘work from Torrey’ and come enjoy the event with their clients and network with other attendees,” he said.
Gorsich also said that while most times of the year there are multiple events happening in San Diego, coming out of the winter holidays through most of the first quarter, there are very few big, social or corporate events to compete with.
“Ours is by far the standout and provides a great place for people to gather and count on a consistent ability for our customers to effectively entertain their guests,” Gorsich said. “We constantly hear that this event gets a tremendous participation rate for their corporate invites because of the lack of other clutter in the market and life responsibilities pulling at them at that time. The weekday timing with the midday hours during a slower period of the year is perfect for them.”

Reports on Title Sponsor

The tournament’s tremendous participation rate may or may not include the current title sponsor of the event – Farmer’s Insurance. A Jan. 11 report from the Sports Business Journal and carried by international outlets including Reuters said that Farmers Insurance will no longer sponsor the event at Torrey Pines when its contract runs out in 2026.
Gorsich, however, said there has been no word from the PGA Tour or Farmers to validate that.
Farmers has been the title sponsor since 2010, and like many insurance companies around the world, has been facing financial challenges brought on by climate change, cybersecurity, regulatory changes, shifts in demographics, technology disruption, and social tension.
“Farmers has been a great partner for the last 15 years and they are contracted through 2026,” Gorsich said. “They will be coming out to celebrate the 2024 event and there are no pending announcements. At this time, there’s not much of a story here.”

The Farmers Insurance Open and its days-long media coverage of San Diego’s weather and scenery is an intangible driver of tourism to the region. Photo courtesy of Farmers Insurance Open

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